John Dorfman Columns category, Page 4
John Dorfman: These 5 stocks look enticing on cash flow
It’s a simple formula, right? A business’s profit equals its revenue minus expenses. Yet, this can be tricky. Some expenses are intangible. Say you’re a cruise company and bought some ships five years ago, paying out $30 million. You didn’t subtract the whole $30 million from your profits that year....
John Dorfman: Sane Portfolio enjoyed a good year
The Sane Portfolio wasn’t intended to burn up the track. This is a hypothetical portfolio I devised in 1999 and have refreshed almost every year since. It’s intended as a slightly conservative, middle-of-the-road collection of stocks. But in the past year it’s risen 23%. To be eligible for the Sane...
Nucor, Albemarle show value, growth
Hatfield vs. McCoy. Montague vs. Capulet. Yankees vs. Red Sox. Great feuds, each. But what about value and growth, the two main schools of investing? They don’t have to be enemies. Once a year, I write a column on stocks I believe show value and growth characteristics. For 17 columns...
John Dorfman: Investing hints from 7 investment masters
You can’t teach genius. But you can learn a lot from observing geniuses at work. Here are a few nuggets of investment wisdom from seven master investors. John Neff The manager of the Windsor Fund for three decades, John Neff was a quintessential value investor. “To us, ugly stocks were...
John Dorfman: CVS, Phillips 66 and Lear look good on this gauge
A good tool for spotting turnaround candidates is the price-to-sales ratio. Start with a company’s stock price. Divide it by the company’s sales (revenue) per share. If the number you get is less than 1.0, the stock is cheap; typically the company is straining for growth and profits. When you...
John Dorfman: Occidental Petroleum, Valero on Casualty List
Let’s postulate that the goal in stock investing is to buy low and sell high. If so, it makes sense to look at stocks that have been banged up, searching for ones that have recovery potential. That’s the goal of my quarterly Casualty List. Today, I’ll highlight two large energy...
John Dorfman: Civitas, Mueller can boast high profit, low debt
Two of the badges of corporate success are high profits and low debt. Today, I draw your attention to five stocks that excel in both regards. Each has a return on stockholders’ equity of 20% or better. On this measure of profitability, I consider 10% decent and 15% good. Each...
John Dorfman: I own these 25 stocks in my personal account
While I write about more than 200 stocks each year, I own far fewer. Once a year in this column, I discuss my holdings. Here are the 25 I own personally and for most clients now. Communications I hold the same three communications stocks I held a year ago —...
IBM, Colgate and 3 other stocks I would sell
My father owned International Business Machines (IBM) stock most of the time from the 1950s to the 1980s. Maybe your father did, too. I hope he did, because IBM shares rose well over one hundred fold in that period. Today, I think IBM and some other well-known names should be...
John Dorfman: Acuity, Littelfuse join the Do Nothing Club
Some people love stocks that are surging. Others love stocks that have been knocked down. Investors pay less attention to stocks that have been holding still, and therein may lie an opportunity. Some of these Do Nothing stocks may just … well, do something. Hence, my Do Nothing Club. It...
John Dorfman: As rates rise, here are 5 stocks with little debt
Thanks to Jerome Powell and his crew at the Federal Reserve, interest rates are about five percentage points higher than they were a year ago. For stock pickers, that means debt once again matters. This should be a good environment for folks who prefer low-debt companies. Beginning in 1998, I’ve...
Old Faithful picks have more than doubled S&P 500
Walk up to any graduate student in finance. Ask her to design a stock-picking screen. I’ll bet you a milkshake that she will design something more complex than my Old Faithful stock-selection paradigm. Yet, my picks in this column drawn from Old Faithful have averaged more than a 19% return...
John Dorfman: 30-30 Club Gets More Exclusive with Microsoft, Merck and 36 More
What do Mike Trout and Microsoft have in common? Both are members of a 30-30 Club. In baseball, this club contains those stars who have smashed 30 home runs and have stolen 30 bases in the same season. I have a 30-30 club for corporations. To make it, a company...
John Dorfman: Winners, losers reveal market’s flavor this year
You can understand a lot about this year’s stock market by looking at the winners and losers among the nation’s biggest stocks. Among the 167 stocks with a market value of $100 billion or more, the best performers this year are: • Nvidia Corp. (NVDA), up 83%. • Meta Platforms...
John Dorfman: Nasdaq leaps back to the forefront
Like a race-car driver slicing in front of the competition, the Nasdaq Stock Market has resumed market leadership in 2023. This year through March 17, the Nasdaq Composite Index has returned 11.1%. The New York Stock Exchange Composite Index has fallen 3.8%. The most widely watched market gauge, the Standard...
Two insiders buy shares at Devon Energy
The CEO of Devon Energy (DVN), Richard Muncrief, made two purchases of his own company’s stock in February. That’s intriguing, because the price of oil and natural gas have been falling lately. Shares of Devon, the 18th-largest U.S. energy company by market value, are down more than 18% in the...
John Dorfman: DEFT contest winners predict recession
“Think of the economy as a big exuberant dog that jumps up on people,” my father said to me long ago, “and think of the Fed as a man with a rolled up newspaper.” The man taps the dog lightly to get it to stop jumping, but that has no...
Moderna, Cirrus Logic are Balance Sheet Powerhouses
On a hilltop in your town live two people. Joseph has an income of $400,000 a year but little savings. Francois has income of only $90,000 a year but $30 million in the bank. Who would you rather be? Any sane person would pick Francois. And yet, when they go...
John Dorfman: PulteGroup and Group 1 Automotive show value, momentum
Just because a stock is cheap doesn’t mean it can’t get cheaper. That’s why some investors prefer stocks that show both value and momentum. Twice a year, I highlight a few such stocks in this column. Here are a few more. Each of these stocks has beaten the S&P 500...
John Dorfman: Don’t be a stranger to non-U.S. stocks
Most economists predict a recession for the U.S. in 2023. No one is good at foretelling the future, but the recession threat may be one reason to consider adding some non-U.S. stocks to your portfolio. Here are five foreign stocks I currently like. All of them trade in the U.S.,...
John Dorfman: Market following classic January playbook, so far
So far this year, the stock market is doing exactly what market lore says it should. According to tradition, four things are true about January: • The market is likely to rise. • Small stocks will excel. • Last year’s losers will rebound. • As January goes, so will go...
John Dorfman: Mosaic, Resideo new to Casualty List
Get ’em while they’re down. Buying stocks on bad news that is real but temporary is a time-honored technique, used in the past by investment masters such as Jonathan Neff and Sir John Templeton. It’s the idea behind my quarterly Casualty List, containing stocks that have been knocked down in...
Dorfman: Amazon and other analysts’ favorite stocks face-planted in 2022
When 2022 began, Amazon.com Inc. (AMZN) was Wall Street analysts’ favorite stock. Thirty-one analysts said to buy it, with nary a “hold” or “sell” to be heard. The stock fell nearly 50% last year. This is not an anomaly. The other stocks the analytical corps adored when the year began...
John Dorfman: Robot Portfolio chugs on, up 915% in 24 years
Give that Robot some new polish! The Robot Portfolio is a hypothetical collection of 10 stocks I have compiled each year beginning in 1999. In 24 years, it has achieved a cumulative 915% return, compared with 373% for the Standard & Poor’s 500 Index. The 10 stocks are picked by...
John Dorfman: Sifting through the ashes of 2022’s biggest disasters
Coinbase Global Inc. leads this year’s list of stock-market disasters. Here are the stocks down the most through Dec. 16, among all stocks with a market value of $5 billion or more. • Coinbase Global Inc. (COIN) 85.5% • Snap Inc. (SNAP) 82% • Twilio Inc. (TWLO) 81.8% • Lucid...
